How to Keep a Budget
Having a budget is the first step in taking control of your finances. Whether you want to create a budget to understand where your money is going or to save money for a particular goal, make it clear and specific. The more detailed your budget is, the more useful it will be.
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Instructions
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Set a goal. Knowing why you need a budget and what you are trying to accomplish will help you stick to it when you feel like spending your money on something else. Make the goal clear and specific, such as "pay for college" or "buy a new car." Include specific amounts if possible.
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2
Keep track of your expenses, down to the smallest one. Use different categories such as household, transportation, entertainment, education and health. Make a special category for all loans and credit card payments you have and don't forget to list incidentals such as a hobby, books and newspapers or movies on demand.
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3
Make a list of your income. Use your salary as a base, but don't stop there. If you regularly receive additional money through bonuses or work you do on the side, add it to the list. The same is true if you freelance or you participate in some type of saving or investment group.
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Figure out how you are faring. If your expenses are higher than your income, you are probably running credit card debt every month. Even if both numbers are close, you may still be spending much more than you really have to.
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Figure out ways to cut down and streamline your budget. This can be as simple as eating out less often, turning off your cable TV or switching to a cheaper gym. Depending on how much you want to save and how important the goal is, changes can take more than a month and be more or less extreme.
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Tips & Warnings
You don't need any special software or equipment in order to set up a budget. You can use a simple sheet of paper to get you started and then move on to software when you are ready for something more advanced.
Keep your budget up to date. If income or expenses change, make sure you revise your budget to reflect that. The same is true if you feel your budget is not working out properly and you need to adjust it.
Be sure your budget allows for an occasional treat or small indulgence. Just as a too strict diet leads to bingeing, a budget that doesn't include any fun expenditures is likely to get ignored.
